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31 August, 18:18

Primare Corporation has provided the following data concerning last month's manufacturing operations. Purchases of raw materials $ 30,000 Indirect materials included in manufacturing overhead $ 4,590 Direct labor $ 58,900 Manufacturing overhead applied to work in process $ 88,100 Underapplied overhead $ 4,030 Inventories Beginning Ending Raw materials $ 11,100 $ 19,800 Work in process $ 54,300 $ 68,400 Finished goods $ 34,300 $ 42,700 Required: 1. Prepare a schedule of cost of goods manufactured for the month. 2. Prepare a schedule of cost of goods sold for the month. Assume the underapplied or overapplied overhead is closed to Cost of Goods Sold.

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  1. 31 August, 22:01
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    COGM 154,200

    COGS 145,800

    underapplied MO 4,030

    Adjusted COGS 149,830

    Explanation:

    Materials used in production

    beginning 11, 100

    purchases 30,000

    available 41, 100

    ending (19,800)

    used 21,300

    Cost added

    Materials 21, 300

    Labor 58,900

    Overhead 88, 100

    Total 168,300

    Beginning WIP 54,300

    Cost added 168,300

    Ending WIP (68,400)

    COGM 154,200

    Cost of Goods sold:

    As the overhead was underapplied, the applied overhead is lower than the actual cost. So the company's needs to increase the overhead in the inventory thus, increase the COGS for the underapplied amount.

    Finished goods beginning 34,300

    COGM 154,200

    Finished goods ending (42,700)

    COGS 145,800

    underapplied MO 4,030

    Adjusted COGS 149,830
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